These are really confusing me. How are you guys remember how to do them? I’m considering just memorizing them, but that won’t help if the type of spread is different than what I studied.
To be honest, I don’t even know a single term in any of those breakeven formulas as I didn’t look at a single one. But I know what positions are involved in each strategy and for that reason, I haven’t really had much trouble getting these questions right in the EOCs or on practice tests. If you know the positions in a bull call spread or a long butterfly, you don’t really need formulas to figure it out.
I draw a picture and see where it crosses zero.